Study supports efficiency of state anti-predatory lawsMortgagePress.comAnti-predatory loan laws
A study by the Center for Responsible Lending has indicated that
laws against predatory lending obstruct abusive lenders, while
increasing availability of credit to sub-prime borrowers, in many
During the study, titled "The Best Value in the Subprime Market:
State Predatory Lending Reforms," researchers examined more than 6
million sub-prime mortgages from 1998-2004--three-quarters of all
sub-prime loans originated during that period.
States with the strongest laws--Massachusetts, New Jersey, New
Mexico, New York, North Carolina and West Virginia--showed the
largest declines in loans with predatory terms. Furthermore,
predatory loans dropped by almost one-third in many of the 28
states with some kind of regulation against them.
The study also found that these laws had no effect on the number
of loans available and that borrowers in states with predatory
lending regulations paid approximately equal or lower interest
rates for sub-prime mortgages.
Predatory mortgage lending costs Americans an additional $9
billion-plus a year, the Center for Responsible Lending estimates,
primarily affecting low-income borrowers.
For a copy of the study, visit